A. Emerson Electric Company’s corporate strategies are diversification through acquisition and expand geographically. It is horizontal acquisition and single diversification. Not like some other competitors go related diversification (like financial services), instead they are focus on manufacturing. And no one acquisition has been very large. They identify business investment opportunities and take it step by step. It is a prudent style of decision & investment. Emerson was target domestic market with broad range of electronic products, and then expands globally with sales grown to 40% of total sales. They also changed from low-cost producer to best cost producer. To support these changes, they improve process technology, increase productivity and gain product leadership. Before 1990, the company was organized into 40 decentralized divisions consisting of separate product lines. Their goal was to be the number one or two in the market for each product line. As it grown bigger & bigger, they changed to eight business segments grouped by common distribution channels, organizational capabilities and technologies.
B. Before planning conference, management needs to prepare four standard exhibits, and top management will set the target for each division. Through the preparation, it helps them understanding their position and figure out a clear picture of what they want to achieved. The data they gather is measurable, such as NOPAT, return on average operating capital. It is cover short term (monthly, quarterly) to long term (5 previous years and 5 forecast years), and is comparable. To control the actual performance close to what they plan, the management will follow up the outcomes. For example, the division president must explain what specific steps are being taken to close the sales gap. It will create pressure on them, but will push them to review the whole process and make adjustment or action if necessary. The data is updated regularly. It increase...